"Well, it could have a devastating impact because Maryland is a rich state. We're a great economy but we're joined at the hip to the federal government. Almost a third of all the economic activity in the state is attributable to the proximity to the federal government, so that's a huge problem for us and we desperately hope that the powers that be in Washington will work things out.

"Even if they don't, we have a real middle class employment and wage situation in Maryland," said Franchot.

They wrote down the withholding estimate for next year by $324 million. Franchot explained why that is important: "Those are middle class receipts coming in, and boy, it means we have an employment problem and we also have a wage growth problem."

One way he's looking at making adjustments is by calling for fiscal prudence going forward. What is that going the mean for the state of Maryland?

Franchot said, "What we need to do in Maryland, which we're not doing right now, is making priorities. Public safety, of course, education, environmental protection. We need to really prioritize health care. What we're spending money on and then we need to manage it a lot better."